 So we're going to have the unenviable task, I think, of trying to sum up everything that we've learned and everything these two distinguished gentlemen have learned over their entire careers in the final 49 minutes of the conference. And I appreciate their willingness to engage in this wide-ranging conversation as a way of closing out our activities for the last day and a half. Let me just start maybe on a more personal note, not personal to me, but personal to you both. Governor Andungu studied in Sweden, got a PhD in Sweden, and also has spent time reaching out to and having conversations with Governor Ingves for many years. And I wonder whether you all might start by just saying a little bit about how you began to connect and what you learned from each other. Thank you very much. That's for me, it's an honor. Let me say that I'm actually a CEDA output from composite building by CEDA. That's how I found myself in Sweden. And so my school life was founded by CEDA, Swedish, and it continues to do that in Africa. So I always tell everyone that I'm actually a CEDA output and I'm going to continue actually building capacity. And capacity doesn't stop there. Even when we go to institutions that are required, we are required to read those institutions, we also have to read in terms of building capacity. So the first time I met Stefan was when I became governor in 2007. And when we started talking, I can say that I have benefited from three areas and we can of course continue talking about other areas. The first thing was, remember I talked about coming to the central bank and the question was, how does central bank actually do its own business with this massive cost? Central bank had only four branches in Kenya and everybody else had to get currency from the central bank. Remember central banks have the monopoly of issuing currency. So one of the things, one of the discussions with Stefan was how do I get the currency management and even the modern vault management so that I can actually introduce currency centers in Kenya. We introduced three currency centers and of course the usual thing about Kenya is that everybody wanted more. I don't know, it hasn't happened since then but we had mapped out. But I was very happy that even the system, the system of even vault management we actually borrowed from Sweden. The second thing was that we had now a large debate, after I'm past a success, the large debate was, how do you conduct monetary policy? When first of all move away from the IMF targeting, that is targeting base money and we have to move out because actually the basic assumptions are drawing that base money targeting was that the money multiplier was changing, the growth rate was changing. So in the sense, I wanted him to inference the East African governors and we had a big conference and they gave a keynote address on inflation targeting and actually how Sweden has succeeded in that inflation targeting. And it works very well. And finally, I had to make a visit to Sweden so many times because I needed to understand how we can inference monetary policy that is communicating monetary policy making decisions. I think Kenya had already, the central bank of Kenya had already moved into having an executive monetary policy committee. And obviously we started even the structural models of forecasting inflation. Then the next thing is how do you actually anchor expectations and that one of them was actually communication. It's the same thing about even MPS and all that. So those three areas I have benefited and I think it has made the central bank of Kenya what it was, the eight years have been there and that lingering experience and even reforms that I introduce are still there. So I at least attribute most of those to Stefan and my relationship with him. But I found that also my relationship around Swedish institutions is also motivated by the fact that I'm actually a Swedish, I see the output and that is why capacity building is still in my DNA. Thank you. Well, just to add to that, I mean, in the central bank community there aren't that many other central bankers to talk to at home. Because usually there is only one central bank and you just don't go to the bankers and talk about your troubles. It just doesn't work that way. So you sort of constantly try to talk to other central bankers about what you are doing and how you go about doing things and you ask questions and then all of us regularly actually at the global level attend the same type of meetings. So in addition to kind of bilateral work we just meet and we discuss various issues that we find of interest for all of us. Going to the IMF, the World Bank, the BIS, other types of meeting because that is the community that you belong to and that's where you kind of quietly can reflect on things without the whole thing ending up in the newspapers. And many of the things that you actually discuss are very practical and what has struck me over the years given that I've done this now for many quite a number of years is that when you get into central banking many central bankers sort of approach is from the macro side, monetary theory, or doing macro monetary policy, inflation targeted. But all of a sudden when you end up being the governor you have sort of like a thousand people who are more than that reporting to you and your job is to run things. To actually make sure that other people do things that you want them to do. And that's kind of a perennial issue among central bankers that you always discuss when you meet and some are ahead and some are behind and what all of us have in common and this is a constant struggle is that all the other ones in your own country know that the central bank, that's where the money comes from. And there's always somebody else who wants to get your money and you don't want to just do that. And then there are different ways of dealing with that particular issue. That's great. So I want to switch to a topic that we've been discussing a lot which is innovation. And I wonder if you could each reflect first on the role of the central bank in being an actual innovator in terms of use of technology, changes in procedures, changes in regulatory approaches. So how do you how do you foster innovation from within? Maybe we'll just start from there and then I'll broaden it out. I think it all depends on where you're starting from. And I didn't want to follow up what Stefan had said, but I think in the Kenyan central bank when I just, when I went there after so many years of training economists in the University of Nairobi and even including AERC, African Economic Research Consortium and even government think tanks. I couldn't get economists I can talk to. And the question was, how do you get researchers in the research department? Because it's so painful when the head of the research department tells you that we fight inflation and we use base money. And then you ask, and what is the relationship between base money and inflation? And he has no answer. So what Stefan is saying is that I was sitting back and waiting for everybody to work. I actually had to write those, develop those models together and then change the way they, I asked, how do you, I asked HR, how do you get people into the research department, economists? Oh, we advertise for management trainees. And when we see in your CV, your studied economics we push you to research. That's disaster. When we actually say the next time you advertise I want you to advertise. Economists don't jump into management trainees. They are not. What they do is that you say I want a macroeconomist, I want a microeconomist, I want finance guy, or then you find them. And all of a sudden the first batch we got was about nine, seven PhDs. And now there's very senior masters. And all of a sudden now I could sit back and just say what we didn't need to do and it would be done. So that's the first thing about the outcome, managing a transition. The next thing is the innovations that came in. One of the things of course I didn't want to elaborate is even being confronted by the market participants that would like to bring this product into the market. The next thing would what do you tell them? That it cannot work. They have tested it can work. So the first thing is let's do a pilot. In the meantime you're actually preparing your team to try and understand how would this work and what are the intricacies or even risks that may come with it. And that is where you could say that the regulator becomes innovative because it's accommodative in terms of what it can do. And that's why when I talk about some of the areas that we have changed in terms of the ways central bank looks at things and all that is because of trying to see that we can actually pilot something and give the market the confidence that if it doesn't work, along the lines we would like to, we can always close it down. That is perhaps an innovation in terms of endogenous in the central bank trying to understand that things can work. In fact, when I talked about Stefan introducing me to, even trying to introduce currency management, the whole idea of having currency centers even among us Kenyans was not very clear. And the politicians were good at it and saying, oh, you're opening central banks in those regions. Now I said, no, not branches. And those currency centers were housed by commercial banks. The Swedish model is that commercial banks were distributing currency anyway. Our model was that you actually central bank issues currency. So essentially what you do, you take your currency into a currency center and you're given space by a commercial bank. And so I argued that over time, we will transfer this function to you. That for me, that was innovation. But then the market took it the world. So there are some areas that we guided the market, but there are some areas actually the market gave us a run for our, should I say, our brains. And then we had to actually sort to this pilot and then see what kind of lease communications can we adopt so that we don't want to stifle what you're trying to do. But at the same time, we don't want to bring something that if you bring something up, you introduce something in the market and it fails. The regulator is not forgiven so easily. The market is forgiven so easily, but not the regulator. Yeah. One of the issues when you run a central bank is, and this is I think holds for in many, many countries is that you can, you have the privilege of hiring the best and the brightest and many, many highly educated people. But it's a constant manager or challenge to get these people to actually do things that you want them to do. And that's quite a challenge because it's quite a difference between coming from the academic field, for academia and sort of think about things. That's quite different compared to having to let's say implement just for the sake of the argument inflation targeting. And that's a challenge to sort of realize that now it's not about how many articles on inflation targeting you have read. It's actually about when this is gonna be implemented and who is gonna talk to whom and how do we explain this to our superiors and how do we actually get this thing done? And what has struck me having worked for many years now with many, many talented people is that a good number of them are actually quite risk-averse. And that means that when it comes to crunch time you have to choose between A and B, they sort of, it bothers them and they just can't choose. That's left to me. And then I say, well guys, you need to understand that I'm paid to decide things. So either you tell me what's right or wrong or I decide anyway because my job is to decide. And I can't leave the room, you can leave the room but I can't. So let's work together on this. And this is a sort of a constant challenge when it comes to running a central bank. Another challenge and this is completely different compared to when you are in the private sector. Let me use the concept time to market. You can build the best cell phone in the world from a sort of an engineering point of view. But if it comes three years after your competitors no one will buy it. When you work in a central bank no one on the outside will ever know when you are done or not. So you can always, you can always write another memo or you can always improve on your last memo. And that means that when you run a central bank you have to create your own sense of urgency because you are the only institution in your country and you have to keep pushing people so that things eventually get done. While at the same time to your point getting criticized is always there so you have to be careful because you have to move the whole system. But if you move too quickly then mistakes will be made and everything you do will always be turned against you by somebody else. And then you have to sort of survive that part of the exercise. And that creates a very, very special environment in terms of how you actually go about doing things. Both really terrific insights. So we've been talking a lot about the role of central banks in financial inclusion. There are lots of different strategies that central banks can take. I wonder first if you'd briefly just say how important is it that central banks are involved in financial inclusion as opposed to other actors. And then I want us to explore a bit what does it mean, what kind of role do you want the central bank to take on whether that's direct provision or enabling as two kinds of strategies. Maybe we'll start with governing this this time. I mean generally when it comes to our legal framework our responsibility is to work and try to provide a safe and efficient payment system. I mean that's in a legal sense very vaguely put. And no one has really defined what it means. So essentially that has left it to us within the central bank to fill those words with content so that you actually do something which is not a legal obligation it's a sort of in some sense directional. And here actually the digital inclusion matters because if you don't have it then you have some kind of a problem with your financial sector. And that's why if you want to run a safe and efficient payment system you really would like to have maximum financial inclusion. And then you sort of work on how to get to that point but you can't force banks to do this and that or you can't force the general public to do this and that but what you can do and what we do is to act as a catalyst. And here the distribution of notes and coins is a good example because it costs money to handle money and people tend to forget that. And then most people come to the central bank and said we would be incredibly happy if the central bank is willing to subsidize this whole thing because then the problem kind of goes away. But what that essentially means is that that means less of a dividend to the government. So there is a cost to society as a whole to run a highly inefficient system. Now in order to run an operating more efficient system then you need to get all the interested parties in the same room. And that means that you have to have people from the banks you have consumers, you have to have retailers, you have to have businesses and you have the supervisory authorities in the same room so that you get to an agreement on what the map and what the world actually looks like. And there you can sort of, and this is popular term nowadays, you can sort of nudge all the interested parties into moving in a proper kind of direction. And usually these individuals and these organizations have great difficulties talking to each other because essentially they're struggling among themselves about trying to push the cost to somebody else. But we can always get them in the same room and we can force them to sit there until there is some kind of an agreement on how this is managed. And that's quite helpful. What also has struck me over the years is that in many fields where we really don't have a formal responsibility at all in the eyes of the general public they think that we have something to do with the particular matter because my name is on the notes. And then they say somebody's got to be responsible for this and that means that in a very kind of subtle, soft way of responsibilities go beyond what we actually are required to do. It's interesting to me that this is a very common way I think that many central bankers describe how they engage in decision making and in standard setting and rule making as a kind of exercise of soft power. And so I'm wondering, and then I'll switch to Governor Ndungu but I wonder if you could just say a little bit about when you see that use of soft power is appropriate versus saying this is the rules for payment or go away or we're providing the payment infrastructure, this is how it's gonna work, go away. Once in a while you get to a point where nothing happens and then you say, okay, this is the way it's gonna be and if you want to do the clearing with the central bank these are the conditions. So that's one issue but the other issue and here the Riggs Bank is a good case. We have never had supervision. Supervision has always been handled in a separate authority but we've been around for hundreds of years. And when things really, really go wrong supervision does not matter. Then because people know that supervisors don't have any money, all the money is in the central bank. And that's well understood in the banking community. So being a private sector banker you don't put yourself in a position where you know that if things go wrong you have to come and ask for money at the central bank not having delivered on certain things in the past because then you know for sure that the central bank has the upper hand because at that moment the central bank decides whether you'll be around the next day or not. So that's also kind of an element of this. So you want to have a, you want to carry out a decent conversation in peace time but also make sure that people do understand that when things go wrong, things will change. That's great. Kevin and Dunga. Yeah, the subject matter of financial inclusion is very interesting as you started by saying but different countries, for example, I think it would be in Sweden, you would not really talk about financial inclusion because first of all everybody is financially included in different degrees. But when you come to countries like in Africa, for example, in Kenya, this is a really serious public policy because it's a market access, it's a question of market access. And market accessibility and different markets for that matter in general is actually very, very important because it helps the poor in terms of accessing the market. They can sell their labor or even access to sell their wares. But financial market is very, very important because it allows them to save and perhaps invest and even enrich their asset base so they can escape the cycles of poverty. The whole issue is how do you do that? By the time I entered the central bank, there was the idea was that, oh, we can introduce microfinance so that microfinance can establish branches closer to the population. But I think for almost six years, the microfinance bill was there, but the parliament again has not approved even the guidelines. So I think what I did was, no, the guidelines were not yet prepared. I think I quickly realized that there was a friend working with the UNDP in Nigeria and they had developed a draft of guidelines. I borrowed that and we changed. But even when we did that, most of the banks that started as microfinance had already given up and they became banks. So the whole issue is that you have to start all over again. Of course we started community-based microfinance, nationwide microfinance. We draw a threshold of capital, core capital requirements. But this did not do the trick because everybody was waiting for so many years. So then that is why I'm saying then you have to try different angles and different, should I say, instruments that can help. And that's why when I come to, when I come to agency banking, for example, or even M-Pesa, Mumba phone financial services, they became the quickest instruments to achieve that. Today, when you go to Kenya, there are more microfinance than there were 20 years ago. But it is because they are now moving in tandem with how what microfinance is doing. Most of them are agents of banks at the same time. So, but what was the basic constraint? Why was financial inclusion not working? Because banks never realized that they didn't have the technology or they did not invest in the technology of trying to manage microaccounts. Microaccounts means people with low incomes and they have to open bank accounts. That low income is sometimes, it's so low, sometimes it's irregular in terms of flow. So sustaining an account in the bank was very, very expensive. So, and then from then on, if you get a technology that can manage microaccounts, then you can see what actually happens. And that's why in my talk today, when I talked about virtual savings account, for me it was really an eye opener for the banks. And that's why all of a sudden we found that we moved from about 4.3 million accounts to about 28 million accounts. And mobile phone accounts are even much higher than that. Now I've seen that it has worked the same way in Tanzania. It has worked the same way in Goanda. So the whole issue of accessibility to markets is very, very important, but financial markets are very, very critical. So looking for investment and even instruments to do that becomes very critical. We've had a lot of discussion about digital cash and I want to return to that topic now. I think it might make sense, starting with Governor Ingves to talk a little bit about the role of private money and public money. What is digital cash? Has it played a role in that? Should we have, is there an advantage from a financial inclusion standpoint of central banks offering digital currency? Is that fundamentally different or fundamentally the same from offering an account directly at the financial institution? How is that different from holding a bank account? I mean, I think there's a lot of maybe confusion in the market about what these different kinds of approaches might mean. And there's a lot of what I'll describe as froth about Bitcoin and the possibility of non-fiat digital currency being important in this space. So I wonder if you just reflect on the appropriate role in way of thinking about digital cash in relation to public and private money creation. It's hard to come, I don't know, I don't have the perfect answer to this because this is an issue which has been with us for hundreds of years. So in that sense, there is nothing new under the sun. But let me start way, way, way, way back. And my institution has provided money in one form or the other for 350 years. Now, then if physical cash goes away, then that of course raises the issue. Should you just let it happen and say, oh, we didn't keep track of this thing, it just sort of happened and now we only have private money or should you carefully consider which way to go? And that's essentially what we are doing. Now today, this is considered to be something entirely new, but I read a paper the other day where the author had looked into what central banks have done in the past. And the conclusion was that it's only roughly over the past 70 years or so, it has been impossible for the general public to hold the deposit with some central banks. So in that sense, this is not a new issue. Ultimately, it's gonna require some kind of a value judgment, but we do know if history gives us any guidance and take this country as one example, you had a period with private bank money only and that was not successful at all. So ultimately at the end of the day, one way or the other, governments need to be involved in this because they tend to back up the financial system in one form or the other, being it everything physical or everything digital. And that's why this matters. And then we have, and I think this is where we will end up in many countries for maybe over time, we have sort of hybrids when it comes to this because you can create a central bank digital currency which is sort of token-based. You can create something which is very similar to physical cash, but it's digital, or you can create something which is account-based or you can create sort of a hybrid. Ultimately it's gonna take some kind of a value judgment to do that too early to tell which way this is gonna end up over time. But having said that, and others referred to what is happening in China today and you have these new tech companies, but they have just reason to be required to hold to back up their deposits with a 100% reserve requirement. Well, that's essentially turning their private money into central bank money. That's what came out of it. Despite the fact that the whole thing sort of started as a completely private sector undertaking. So here I guess that different countries will end up with different solutions, but ultimately it's really a political issue in the sense that money, your own currency is part of the nation state. And there is no way around that. I mean, we used to have old kings in some countries, presidents and all sorts of stuff and people that people recognize on the notes because part of a nation is the money that you have created in that nation. It's only if you have been completely unsuccessful in doing so that you end up with changing to somebody else's currency. But then we talk about miserable cases like Venezuela and Zimbabwe and those issues. So my conclusion so far and my apologies for talking so long about this is that ultimately at the end of the day, it's the political economy of this that will decide which way you will go. So this will never be decided by economists only because it's such a sensitive issue which way you would prefer to go. Governor Ndugu, do you want to add to that? Yeah, I can maybe follow up with some like a question asking why now the Kramer for digital currency and maybe tie up with the previous session. They talked about AML, anti-money laundering. And obviously when it is digital currency, does it make it easier for monitoring? And maybe there's a question we can follow up. When I joined the central bank, one of the things was about monetary policy and then 25% of the currency in circulation is outside the banking system. Then the question was how would you conduct monetary policy when there's such a large amount of currency outside the banking system? And so the whole thing is Kramering for digital currency. Is it going to be easier in terms of AML CFT regime? I know I went to, I joined central bank, I've been on market because I joined the central bank when Kenya was in the dark gray list in the FATIF classification. And I had to try and reverse that because essentially we were getting into serious issues even with correspondence banking. And one of the things I argued strongly was that it is the informality of markets and informal markets. The moment we move away from informality of markets then we can actually even monitor the currency in circulation in a better way. And financial inclusion was one of those success stories. So essentially I don't know whether the Kramer for digital currency right now is to make sure that we have better control or is it, I'm trying to ask myself, but I do think that would make a lot of sense, especially if it's going to aid in terms of transactions or payment system. That for me would make a lot of difference. And also if it's going to support financial inclusion but not digital currency the way it is being seen, like we have for cryptocurrency trying to trade. I was giving an example of a Bitcoin. I think the first time we went for a conference talking about electronic money in Abu Dhabi, the Tercos told us with the Governor Ben Nduru of Tanzania that we are going to affect money supply before you know, money supply process before you know it. And we asked them how? Because back to Stefan said the Chinese are asking for 100% backing. Electronic money in Kenya, that is the impassant type of transactions were 100% backed. So there was no way Tercos would even influence money because they were actually doing shopkeeper kind of function. You change cash into electronic units of cash and that's all. And it's backed 100%, it's not a deposit. So anyway, those are the, there are more issues but I think the more we try to understand where we are going and where we are coming from, maybe the better because then digital currency will be understood in a better way. It's not changing the way we actually know about money. If we change that, then obviously we're going to an unknown territory but I think Stefan has said it is not unknown, it's actually always known. It's only that we, because of the current times we forget what has happened in the last 70 or so years. I like when I'm teaching my financial regulation class, when we're dealing with this, I like to show pictures of bank notes and ask people, are my students if they have any idea what this is? And it's an interesting thought experiment to see. Let's talk a little bit about the ways in which central banks might need to adopt their own cultures and human resources and approaches as there are more and more non-bank actors operating in the system. So maybe we'll start with the Kenyan case and with the rise of M-Pesa and the need to negotiate with the telcos and the telco regulators. How did the culture of the central bank of Kenya change? Yeah, that's quite interesting because I always say that every charge has its own solution once you think so, I mean once you are focused in terms of a solution. And one of the things about the way the pilot was conducted in Kenya before the M-Pesa was launched is actually one of them is one of the teams trying to make sure that this cannot work is a pyramid scheme. On the other side the other teams just saying actually we can find solutions way around it. At the end of the day just like Stefan said it depends on who is the team leader and the team leader wants solutions. And it doesn't want solutions to block the innovation. You want solutions to make sure that even if it doesn't work today there is a promise that it can work because sometimes some of the innovations are ahead of their time. And that is one aspect of it. The first thing is that we did not have a national payments department in the central bank because even though it was a money we didn't have even experts in that area. So the whole process is saying if this is the way we're going to work then we have to push very hard to get experts in that area in the national payments who can actually also help in trying to understand the market. It is going to be very difficult for a regulator to sit back and maybe the private sector telling you exactly what is happening out there. You are supposed to be the regulator and then the traditional way is that you are a regulator. So essentially you have to have the knowledge to match what the market is telling you. And those are the, should I say, the initial minds of actual speed in trying to try to understand what the market is proposing and trying to understand how then can you actually push this forward? What I did was always to use the available network and one of the ones that I used in Kenya was the FSD. FSD network have done a great job in Africa today because they provide various knowledge-based studies and even data to try and understand what is happening. So what we did was to invite FSD so that we can use their network even globally to actually come up with some draft regulations to understand what is happening. I called them draft regulations because unless the paramedics also passes them you cannot use them. But as soon as, as long as they are draft regulations you use them because you can use them to issue guidelines. And that is the starting point. Even the institutional capacity of the central bank was helped by the draft guidelines. In the end they became the guidelines but the first thing is to do that. So essentially if you're confronted by a new idea the most important thing is actually to see how you can instead of setting the market away you try to encourage the market to move on while you're also studying the situation. And that is what's helped the central bank institution. And so many other issues that I can give examples that is the direction that I took to make sure that the institution is not left behind even if it doesn't work. The knowledge base that is left in the central bank works very well in terms of institutional building and even capacity building on the central bank. Governor, I wonder if you could talk about the cultural change that might be needed at the Basel Committee on Banking Supervision and at the BIS and the other standard-setting bodies as the world evolves to include many more non-bank players, potentially very large social media platforms, the big tech companies. What needs to change at the standard-setting bodies to figure out what the right set of new approaches for that world might look like? I do just need to accept that the world is changing and that you can turn back time. And then a major issue in the future will be when somebody will have to decide if it works like a bank and it quacks like a bank and it swims like a bank and it probably is a bank. And that's an issue that one is going to have to deal with one way or the other and it's definitional and then of course some of these new providers of services will have to accept that because you can't have, and referring to their panel before us, you can't have players where let's say AML rules don't apply just because they call themselves a tech company. I mean, that's not really acceptable but that also means that we probably will have to accept different types of banks in the future that some of them will be more kind of narrow banks. Maybe some of them are more kind of payment services providers and some of them do everything the way some many banks have done for a long, long time in the past but you just can't, you just have to live with that and on the regulatory side decide where to draw the line saying that now you have come so close to dealing with financial services in such a way that you are actually a bank and part of it is going to be dealing with the risk aspect of this because banks have to have capital because they blow up once in a while and that causes a huge problem and a huge cost to society as a whole and there is an enormous negative externality coming out of a banking crisis and if you get new players into the system that run the risk of creating similar types of externalities for society as a whole then you actually have to say, okay, not beyond this, this is what you have to comply with but that of course will be difficult for the Basel committee and other committees to deal with over time because when the world is changing you just have to change because at the same time it doesn't make sense to regulate certain entities where the whole business has moved to other entities so it's a tricky one. A constant struggle and innovation. Yes. Let me ask one final question of both of you and then I'm gonna open it up. So we've been struggling a lot over the last couple of days and the project is over the last year and I think quite a big picture about what a central bank of the future might look like, should look like in a way that promotes financial inclusion. Let me give you each a couple of minutes to say what you think should be key elements of such a central bank. Again, if you were able to live in the world we live in that is you live in a real world but you have the ability to project forward in ways that free you from the current institutional constraints that we're all faced. So maybe I'll start with Governor Ndungu and ask you to sketch that out for us. Thank you, thank you very much. I think I started by saying that central banks and the way I looked at it when I joined the central bank was that actually it's an agent of market development even though it's a regulator because the moment you start waving an axe especially in the markets where we belong you are likely to find that you'll be killing the market. And if you are lucky to survive because again this politics is more broader then you'll find yourself talking you'll find yourself that you are all alone in that process. So encouraging the market becomes very, very important because once the market has already formed for example, let me give you like the payment system all of a sudden there was no payment system and PESA wants to come into the market and you come up with the regulations we even the legal system was actually approved finally we even created a space where you can even have standard on chaos, payments chaos but they have never managed to stand our own actually they are still in the banks they are still except a few forex bureaus that have tried to do that because we added the component of foreign exchange remittances to try and formalize and remove Hauara from the underground and it has worked well in that way but they are no standard on because they still believe that you can have that transaction spread from still in a bank and operate that you can still be in a bank and operate but the moment the market unites the market towards the development that you'd like and then you can once the market is upright and moving on then the central bank retains its core function and that is what I believe the future central bank should be is that you do not learn away from helping the markets or even helping the markets or intervening creating appropriate interventions in the market so that you move in that direction and then leave the market to the driver and so on let me give two examples the first one was that how do you create credit reference bureaus in economies like ours, share information started by telling politicians that we are going to share negative information so that we actually can push the market to the next level we want CRBs that can create your credit scores and obviously in the wrong run we want to change the collateral technology that was in use but if you go in a very, should I say, forecast way and say that you want both negative and positive information you're not going, you'll not manage to get through the parliamentarians so the first thing is that they accepted after some years then I went back and I told the finance committee of parliament that we want objectivity here so we need to bring positive and negative information and then they accepted so we created a project and then CRBs were there they were being supervised by the central bank then that project moved and became like a good consultancy unit that would help CRBs work through but then is it five years ago they started no six years ago they started using that when the government, when the president appoints you as an ambassador the first thing is to see bring your CRB certificate then of course I had already gone out of the central bank and they said, where is this Jogunadu? He actually made, you know, pushed us to this idea so you can see that we have managed to create an institution that is working but it is a process of nudging the market to that level there are several examples that we can give but one of the things right now is that there is no longer any controversy about any telcos in terms of managing payment system there is no confusion anymore because they know exactly what is the dividing line because everybody, the telcos thought they were participating in the money market but the moment you create that market the central bank is never involved anymore in terms of negotiations between commercial banks and telcos in terms of the products they are going to roll out the central bank just looks at the products and says this is appropriate so my idea of the future of the central bank is to make sure that and especially in developing markets that you help the market understand where it's going try to navigate and intervene where there could be risks and try to straighten up the market for them once they are upright and they are moving and they are developing the market in their own market segment then the central bank should move on and to its own commodity but we live in a world where there are segmented markets until we threaten those segments of the market segmentation will create a lot of dangers in terms of should I say structural change even economic transformation but I know where central banks in Africa have moved in and threatened those segments of the market it has worked for the world that's the way I would look at it I would say that it is developmental in nature but there are limits you cannot always carry the market with you you need to remain in the segment of the market where your specialty lies and also the capacity of the central bank is going to be recognized in that sector monetary policy is not going to disappear it will stay because somebody has got to be there to produce a reasonably stable price level whether we call it inflation targeting or something else doesn't really matter but the key issue has stayed the same for hundreds of years that somebody has to make sure that you don't end up with too much inflation or deflation for that matter financial stability is definitely not going to go away I mean that will be with us forever I think because financial instability creates so much economic destruction in any economy so you just don't want to go there and then in addition to that given that central banks actually have a balance sheet so everything you do when you run a central bank passes through the balance sheet of the central bank in one form or the other that's just the way it is and having a balance sheet means that you relate to the financial sector in one form or the other because you do things together with the various participants in the financial sector via your financial, your balance sheet and that creates an environment presently where you need to provide efficient central bank, clearing 24-7 in central bank money and then based on that you allow the financial sector to evolve in such a way that the general perception among the general public is that these things are managed and handled and produced in the private sector in an efficient way and the central bank should not block the evolution of that efficiency in addition to that and I should have mentioned that earlier what comes now when we're not so not really any more focusing on the distribution of notes and coins more and more effort needs to go into dealing with the consequences of everything being digital and that's having the capacity to deal with cyber risk in different shapes and forms and that of course takes us into a completely new world and a completely new environment in terms of the competencies that you actually need to understand these things and that's because when people think about the central bank they think about vaults and they think about physical money or I get constant emails about people complaining to me saying why is it that our goal is located in London and in New York and not at home and things like that because that's the way it used to be in the old days now all of this will be replaced by actually understanding in the digital world what happens and how do you ensure that it is safe? Thank you Chris Claude from the Gates Foundation so this has been a wonderful opportunity to look into the lives of two central bankers from two different markets but seeing how similar actually the challenges have been how lonely the job sometimes is but how much support you get from each other and from other central bankers around the world so this is truly an inspiring message to hear and I really appreciate that you took the time to share that with us I did wanna ask a question that's central to this conference and that is we've talked about inclusion and the role of central banks maybe in promoting inclusion and we know that not all central banks have a mandate here and so on but I wanna broaden the challenge a little bit earlier this morning we asked inclusion to what end and one reason might be to prevent and help people get out of extreme poverty especially do central banks have an interest in alleviating poverty you can have stable prices you can have a well functioning payment systems you can have safe and sound banks and still have lots of people living in poverty so what is the interest of central bank in the subject? It's hard, I mean it's hard to deal with it because it's not within your mandate and that of course raises the perennial issue how to deal with these types of issues because given that people do understand that you produce money in the central bank then from time to time others want to use your money for all sorts of purposes that they feel are sort of good for society as a whole but still you need to find some way of drawing the line because if you get involved in everything then eventually you don't know what you're doing anymore and there are so many nice things that you could do but you need to stay within your mandate but what you can do is talk to others about what you as a central banker think is good for society as a whole despite it not being part of your mandate You know Chris, one of the things about central bank muddied and the way it is written in the constitution is that there shall be a central bank for example in Kenya we revised the constitution I think 2010, there shall be a central bank which formulates monetary policy but if you go into and then the rest of it is being in the act, if you go to the act it is there will be all those functions and at the end of it is that it has to support governments development agenda which is so broad but let me go to your question about poverty I believe that financial inclusion will solve poverty sustainably but you see the way you push that to that end where you have sustainable poverty reduction is actually assuming that all other institutions will pay their part and that's one aspect and I think from recent studies including even what I think was presented yesterday about women in banking because I personally have seen that women can actually even save and invest in the products that cannot be encroached but that's one side of the story and we cannot actually have this attribution to the central bank but you know that it is started and ignited the process and other institutions can take over but the other one when you come to the general aspect of monetary policy and especially in countries where we come from ourselves monetary policy actually can affect relative price movements and obviously it's going to be very critical in terms of public policy public policy being a reduction, a poverty reduction and the other function in developing countries that we worry about and everybody watches in the news and the newspapers every morning is the currency movement which actually related to your foreign exchange management and the moment the currency is moving and I gave an example today that if your currency moves by 10% you're likely to get a commission of inquiry in the parliament. I have had so many myself because essentially you need to explain to us why the currency move by 10%. What is happening here? Why is the currency more important? From the politician is national pride that your currency is strong but we always tell them that is bad but you will not get it through to them. You can try. But the other aspect of it is that in the general case is that it actually leads to relative price changes which is massive. It can actually, they'll be losers and gain us. So in a sense it's a whole debate of what is development here and what is the attribution to the central bank but they are direct functions of the central bank but they are also indirect that we can influence in some way. And to that I mean sort of that if you lose price stability the poor will lose the most because they are the last ones to understand what is going on and they have nowhere to run. All the wealthy people and the well educated people they know exactly what to do and where to go and depending on in what part of the world you happen to be located some of them go to Miami others go to other places but the poor have no choice they will lose everything particularly if you end up with hyperinflation and that's why it's so incredibly important to try as best as you can to stick to monetary stability because that is definitely a good thing for the poor. Thank you Michael you yielded our time to us but thank you and Adrian and all your team for an amazing conference just building on something that I'm trying to wrap my head around. So both you governors talked about how lonely the job is every thing that you do in terms of coordination. There's a lot of myopia out there like you yourselves talked about some of your brightest economists and everyone and you see it in all kinds of sectors. Do we really have the ability to chew gum and walk at the same time? So for example, every time there's a global financial crisis so many people are thrown back into poverty. So many people we're trying to help middle classes the poor and obviously financial inclusion is something that we absolutely have to go forward on and as central bankers are becoming more involved and more politicians wanna have their hands in the cookie jar what is the risk to the central bankers to be able to balance those two in the critical times? Well if you are a central banker or a bank supervisors your job is to say no and that's hard to do always. I think I personally my experience is that we live on a very tight rope. Here we talked about monetary policy but when it comes to conducting monetary policy in for example some economists where I have come from the Horn of Africa which is ravaged by weather cycles most of the inflation will be supply driven and it's a supply side issue but you don't have instruments for monetary policy for the supply side and the worst bit of it is that when I talk about Horn of Africa I'm talking about drought and energy prices and sometimes there is always a coincidence that also energy prices are also changing. You can see that the impact is massive. What is, you have three press nights because you don't have supply side instruments to deal with supply side inflation so you have to use the demand side instruments so it means that in the short term if you are lucky you have to plug the economy into a temporary recession until the crisis is over because you only want to prevent prices the shocking prices from becoming a prattu so that from becoming permanent to become a prattu so that after the crisis the price can come back and that is a very, very tight issue and we have gone through those cycles actually you always watch we used to watch the month of January, February and March because that's where if there will be a crisis hitting food prices you'll know you have to start looking at it from there and what is happening here? At the end of the day you have different regulators who should have different buffers so that they create economic resilience here. Central Bank can only keep half one buffer that's foreign exchange reserves just in case you want to support the market in times of crisis but when there's drought that's the time you realize that there are no food surprise in the where you anticipated and even poor reserves can only last you 21 days and all that and all that fiscal surprise is a dream that we haven't even had in our own country so you can see what keeps it's at the end of the day who is left hanging on a very precarious position is always the central one so essentially you know that creates their oneriness in that position because you're watching in you're watching inflation data coming from the Bureau of Statistics and you're asking yourself what is really happening you are watching every day what is happening to full prices and you are also watching in our own region the electricity is actually very much hydro and so when there's a drought you see there's the impact so those are the issues that come among many other institutional issues. So I think we've covered a lot of ground in the last day and a half and even in this last hour panel it's been a really rich and interesting conversation and I really appreciate not only our panelists for our concluding keynote conversation but all of our panelists and all of our participants in this conference I've learned a lot I think it's going to really help us push the conversation forward help in partnership with the Gates Foundation I really think about the future of central banking and its role in financial inclusion which I think all of us having spent the last day and a half here think is pretty critical. We look forward to continuing the conversation with you after this day so I hope you don't mind that we're going to repay your kindness by participating today by reaching out to you over the coming months to continue that conversation continue to push forward with greater details and with hopefully a developing vision for how we can push the field forward so please join me in thanking our panelists and thank yourselves as well.